Chinese dumping charges worry Australian winegrowers

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Sydney | After years of drought and devastating fires, Australian wine growers are worried about the consequences of an anti-dumping investigation launched this week by China, their main export market.

“Very surprised by this survey” which targets imported wines for the whole of 2019, Tony Battaglene, president of Australian Grape and Wine, the main interprofession of winegrowers in Australia, says he has received “more than 1000 calls” in the hours which followed the Chinese announcement Tuesday: “the members of our organization are very worried”.

There is no doubt that this investigation, in the wake of a complaint filed by the Chinese alcoholic beverages association, is above all a political decision, in a context of growing diplomatic tensions between Canberra and Beijing.

The dumping of which Beijing accuses Canberra consists in particular of selling abroad at prices lower than those charged on the national market.

“I understand that Chinese winegrowers, whose market shares have declined in recent years, are seeking to protect their interests. But the bottled Australian wines targeted by the Chinese investigation fall into a whole different price category. If they were really wronged, they should go after the bulk wine importers instead, ”argues Mr. Battaglene.

An opinion shared by Bruce Tyrell, general manager of Tyrell’s Wines, one of the oldest wineries in Australia, of which 10% of the production is exported to China.

“The price of Australian wines in China has increased by 30% over the past four years. These accusations of dumping therefore have no basis, ”he said.

Long list of complaints

He remains optimistic about the outcome of the investigation, but such hassle could have been dispensed with. The bushfires that ravaged Australia from October 2019 to February 2020 forced it to reduce its grape harvest by 80%. Those who did not burn were imbued with the fumes of the fires. The grape has taken on “an ashtray taste” and is therefore unusable.

Treasury Wine Estates, Australia’s largest wine producer but also the world’s largest importer of wine in China, has told him that it “will cooperate with the Chinese and Australian authorities”. “China remains a priority market, where we will continue to invest,” said the group, whose market value fell 14% on the day of the announcement, Tuesday.

Since the signing of a free trade agreement in 2015 between China and Australia which resulted in 2019 in a total elimination of customs duties on Australian wine, China has become the first market for the international winegrowers’ international.

Their exports there reached A $ 1.28 billion ($ 1.13 billion) last year. Suddenly, in 2019 Australia also became the leading supplier of wine to China in terms of value, ahead of France and Chile, and even in volume in the first half of 2020.

However, in May, China imposed tariffs of 80.5% on Australian barley, accusing its producers of dumping. This was followed by a temporary suspension of imports of beef.

The announcement followed a request from the Australian government to set up an independent investigation into the origins of the new coronavirus, first spotted in late 2019 in the Chinese city of Wuhan.

A “provocation” according to the Chinese authorities, including the list of accusations against Australia, one of the first countries to have, in 2018, prohibited the telephone specialist Huawei from accessing the 5G market , does not stop lying down.

At the end of July, the Australian government wrote a declaration to the United Nations, in which it considers that China’s claims in the South China Sea have “no legal basis”. Canberra had until then remained neutral on this issue.

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